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In this photo taken Monday, Sept. 23, 2013, a fisherman tries his luck at the Clifton Court Forebay near Tracy, Calif. The Bay Delta Conservation Plan proposes building a tunnel to transfer water from the Sacramento River near Clarksburg to the Clifton Court Forebay where its pumped for use to central and southern California via the California Aqueduct.(AP Photo/Rich Pedroncelli)

Jerry Brown is counting on the Westlands Water District to be one of the major financial backers of his $15 billion Delta tunnels, easily the largest public works project in U.S. history. He needs to dump the whole project, and last week’s admission by Westlands’ general manager is just one more reason: The nation’s largest water district got caught cooking the books with “a little Enron accounting.”

The Securities and Exchange Commission was not amused. It fined Westlands $125,000 to settle charges that it misled investors by faking financial records in connection with a 2012 bond issue. It’s the largest settlement ever for a case involving a municipal bond agency, and it raises major questions about Westlands’ credibility.

If General Manager Thomas Birmingham had an ounce of integrity, he would immediately resign. Instead, it appears he will pony up the SEC’s separate $50,000 fine for his personal wrongdoing and keep his nearly $400,000-a-year job.

Westlands’ penchant for conning investors normally wouldn’t affect Bay Area residents. But the Santa Clara Valley Water District will decide within the next year whether to jump into bed with Westlands and Southern California’s Metropolitan Water District as major investors in the twin-tunnels project. Santa Clara ratepayers could end up holding the bag if Westlands doesn’t keep its financial promises.

Backers of the tunnels argue that they will secure a reliable supply of water for the Santa Clara Valley, which receives nearly half its water from the Delta. But it’s really a water grab by Central Valley farmers and Southern California’s urban dwellers. The project won’t produce a drop of additional water, but ratepayers will bear most of the $15 billion — at a minimum. Major digging projects like this can easily run double or triple cost estimates.

Westlands’ settlement with the SEC includes no admission of wrongdoing, but it’s easy to see why it was fined so heavily.

In 2012, Westlands sought a $77 million bond sale. It needed to tell bond buyers that it would maintain a 1.25 percent debt service ratio cushion, as it had with previous bond deals. But drought conditions had made it impossible to collect the revenue needed to maintain that ratio of revenues to debt service.

It should have been honest with potential investors, which would have raised borrowing costs, or raise rates to farmers by 11.6 percent to make up the difference. Westlands instead took money from accounts set aside for other commitments to make it appear that all was well.

The twin-tunnel project is a bad idea for lots of reasons. Now adding the untrustworthy conduct of a major financial partner, how could Brown even think about moving forward?

The Santa Clara Valley Water District needs to fight going into business with Westlands.